Bubble Meter is a national housing bubble blog dedicated to tracking the continuing decline of the housing bubble throughout the USA. It is a long and slow decline. Housing prices were simply unsustainable. National housing bubble coverage. Please join in the discussion.

Saturday, April 07, 2007

Bubble Sphere Roundup

The Mortgage Lender Implode-O-Meter is now up to 50. The subprime mortgage market continues to decline. Will it spread up the chain to the Alt-A level? Yes Sir!

-Many experts have concluded that the nation's real estate boom of recent years was fueled in part by weakened lending standards that sparked excessive demand and drove up prices. Now, some are worried that the looser standards may have permitted a boom of another kind -- a big expansion of mortgage fraud.-

-These "stated income" loans were designed for a limited purpose: giving self-employed people a crack at homeownership. But during the boom, the number of such loans exploded to the point that they became a running joke in the industry, earning the nickname "liar loans." Estimates vary widely, but research suggests that they made up a significant portion of all mortgages during the boom -- 58 percent in a study by First American LoanPerformance-

-"Nobody wants to go in there and expose how big this is," said Chris Klein, a finance manager at Howard Hanna Mortgage Services, a Pittsburgh mortgage broker, echoing the comments of several brokers around the country. "In the industry as a whole, it's a running joke. If you want to get a loan done, any loan, you can get it done."-

-"It happens everywhere and anywhere," said Fulmer, who is now vice president of Interthinx, an anti-mortgage-fraud company. "If the true scope was discovered, I think it would cause a major crisis."